BMP-4 has been implicated in the patterning of the Dorsal-Ventral axis of mesoderm and ectoderm. In this study, we describe the posteriorizing effect of BMP-4 on the neural inducing ability of dorsal mesoderm (dorsal lip region) in Xenopus gastrulae. Dorsal lip explants dissected from stage 10.25 embryos retained anterior inducing ability when precultured for 6 hrs until sibling embryos reach stage 12. When the dorsal lips from stage 10.25 embryos were treated with a range of BMP-4 concentrations, posterior tissues were induced in adjacent ectoderm in a dose-dependent manner. Thus activin-treated explants able to act as head inducers can also induce posterior structures in the presence of BMP-4. To investigate whether BMP-4 directly affects the inducing ability of dorsal mesoderm, we blocked the BMP-4 signaling pathway by injection of mRNA encoding a truncated form of the BMP-4 receptor (tBR) mRNA. Under these conditions, activin-treated explants induced anterior tissues following BMP-4 treatment. Taken together, these results indicate that BMP-4 may affect the head inducing ability of dorsal mesoderm and confer trunk-tail inducing ability during Xenopus gastrulation.